Collinson FX: May 23: RBNZ holds the line on OCR and triggers NZD rally

by Collinson FX 23 May 11:34 NZST 23 May 2024

WASZPs racing in the SailGP Inspire program - Lyttelton - March 23, 2024 © Justin Mitchell

May 23: RBNZ holds the line on OCR and NZD rallies

UK inflation numbers tumbled, from 3.2% to 2.3%, but remained higher than expected. This was enough to push bond yields higher and the GBP, as market analysts now defer the probable interest rate cuts from the Bank of England, until later in the year. The initial surge in the currency was reversed, when the Fed Minutes confirmed similar circumstances, with ‘persistent inflation’ even suggesting further rate hikes, before any US interest rate cuts, would come from the Fed. This was met with a surge in US Bond Yields and the US Dollar. The GBP beat a hasty retreat, back to 1.2700, while the EUR fell back to 1.0800.

The RBNZ was also hawkish, citing inflationary pressures, in their latest decision to leave interest rates at these elevated levels, until at least next year. The had the same impact on the currency, with the NZD rallying strongly following the RBNZ rate decision, only to fall flat following the release of the Fed minutes. The NZD settled back below 0.6100, while the AUD retreated back towards 0.6600. The persistent inflationary pressures look set to continue, despite enormous political and economic pressures, for cuts. Inflation remains the key driver in currency markets.

For the latest and recent market commentaries from Collinson & Co see collinsonco.com/news-updates

Catch the new look Collinson FX website at www.collinsonco.com

Disclaimer: The details expressed in the Collinson FX website and accompanying documents or transmissions are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. Collinson Forex Ltd accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the information contained or related to this site

Collinson Forex offers valuable insights and solutions to boat enthusiasts and industry professionals alike. They offer a range of tailored currency services, designed to support individuals and businesses involved in the marine sector, facilitating seamless international transactions and optimizing financial operations. Founded in 1994, Collinson Forex is a trusted financial partner within the marine community. collinsonco.com/business-forex

Collinson Crowdfunding provides innovative equity crowdfunding services, aiming to connect businesses looking to raise capital with investors who are looking for new opportunities. They do this by offering a website for companies to make share offers and support to streamline the offer process. For investors, Collinson Crowdfunding offers a simple way to invest in exciting businesses. collinsonco.com/crowdfunding

Contact Collinson on 0800 338 838

Related Articles
Collinson FX November 11: Feel good US economy
US Federal Chairman says he is ,‘feeling good' about the US economy Markets continued to rally, following the huge wave of positive sentiment from the election of President Trump. The Fed unanimously voted to cut a further 25 basis points. US Federal Reserve Chairman, that he was ‘feeling good' about the US economy. Posted on 11 Nov Collinson FX June 7: ECB cuts rates
ECB (European Central Bank) cuts rates for the first time in five years, more cuts expected The ECB (European Central Bank) cuts rates for the first time in five years, as expected, offering relief to borrowers. Markets anticipate that the ECB will cut again, at least once, this year. Posted on 10 Jun Collinson FX: Jan 20: No change with PM's exit
The NZ ‘PM of Aotearoa' resigned yesterday, which had little impact on the currency. The NZ ‘PM of Aotearoa' resigned yesterday, which had little impact on the currency, as this will have little impact on the NZ economy. Posted on 19 Jan 2023